<h1>Regulatory convergence for co-operative banks proposes licensing reforms and conversion pathways to align supervision with commercial banks.</h1> The Reserve Bank reformed regulation and supervision of urban co operative banks through phased prudential measures (including CRAR compliance, prohibitions on director-relative loans, interbank and market exposure limits), adoption of CAMELS ratings and a Supervisory Action Framework with trigger points on capital, asset quality, deposit concentration, profitability and credit deployment, and pursued regulatory convergence by aligning CRR/SLR and KYC norms with commercial banks. Structural policy recommended licensing reforms, governance enhancements (Board of Management), capacity building, expanded fee-based permissions and conversion pathways for large multi state UCBs into commercial or specialised banks, subject to legal amendments.